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One reason this can occur, is if you do not restart your computer when a previous setup prompted you to. Reboot, to ensure this is not your issue.
Dealing with Norton AntiVirus 7.x? See this article.
Other places to read on this error:MS KB 228655
Chris Millard has actually written a program to help with this issue called the "Error 1704 Cleanup Utility 1.0":
"Sometimes, when you try to (un)install a program packaged with Windows Installer, the routine fails. It leaves behind registry entries that give an Error 1704 - preventing further (un)installs of Windows Installer packaged programs. This FREE utility will remove the registry entries that cause the Error 1704." Click here to download.